funding community projects at scale
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funding community projects at scale. Will Dawson, Principal Sustainability Advisor, Forum for the Future. Overview. Who are Forum? Our approach to energy Our energy work Community energy funding at scale Local authority funding at scale Sources of funding Energy Services Frontline - PowerPoint PPT PresentationTRANSCRIPT
funding community projects at scaleWill Dawson, Principal Sustainability Advisor, Forum for the Future
Overview
• Who are Forum?• Our approach to energy• Our energy work• Community energy funding at scale• Local authority funding at scale• Sources of funding• Energy Services Frontline• Take homes
Forum for the Future
Forum for the Future is a non-profit organisation working globally with business, communities and government to create a sustainable future.
We aim to transform the critical systems that we
all depend on, such as food, energy and finance, to make them fit for the challenges of the 21st century.
We have 15 years’ experience inspiring new
thinking, building creative partnerships and developing practical innovations to change our world.
UK Investment required by 2020
From: Transform UK: Mobilising Investment for a clean energy future www.transformUK.org
Some of our energy projects at the Forum
Gatecrashing the energy sector
Climate finance initiative
SEEDA - Low Carbon West Oxford- Ovesco- Eastleigh Borough Council
West Sussex- Low carbon building refurbs
- Schools- Own estate- Behaviour change
Feed-in tariff financing in action
Low Carbon West Oxford
•Local share issue•£1 million raised for renewables•500kW renewables capacity•VFM: c.12x C reduction from PV•90 out of 1600 households•Scaling up to city then county
Case study: Birmingham Energy Savers• funded by Birmingham Council, energy
suppliers and commercial banks, initially £100 million
• 15,000 houses first, disadvantaged areas• Renewables and energy efficiency • Refinance: £2 billion for the next 200,000
homes• 500 new jobs per 10,000 homes refurbished• Part of ‘60% by 2026’ City target
Community Energy Co: Renewables and retrofits
Community Energy Co: Renewables and retrofits
HouseholdsBusinessesOrganisations
Community benefit projects
Low carbon communities modelKey
Flow of money
Support provision and information
Energy and retrofit
Investors Community Fund
Projects
at least £1 billion to unlock to next5 years
If the returns are there, why’s the big money hiding?
1. Most projects are too small to get the banks out of bed
2. Pension funds don’t understand the opportunity – flight to known risks
3. Each project on its own is too risky
Steps to scaling up community energyStep Examples
1. Create aggregation funds FSE Community Generation Fund
2. Use local authority borrowing power
Birmingham Energy Savers
3. Guarantee fund for project losses
Radian/GESB Revolving Retrofit Guarantee Fund trial
4. Unlock new investors Energy4all, OVESCo share issues; UK Carbon Reporting Framework; FSE
5. Support and information provision to the whole system to grow project sizes
Elements: Local Unitied, LDA, Radian, Community Central, Energyshare / British Gas, Forum for the Future, Transition, FoE
6. Higher FiTs and RHIs for community projects
We and others are working on it!
7. Standardisation of project documentation to reduce due diligence costs and hassle
We are looking at this with a number of financing institutions
Sources of capital funding
Established
•Banks•Local authority•Local people•Corporates (e.g. British Gas and energyshare.com)
Possible in the future
•Regional revolving funds, e.g. Finance South East Community Generation Fund•Green Investment Bank
Energy services
Problem: risks and rewards divide interests of energy suppliers, engineers and users
Current Solution: energy performance contract / service company
NHS Trust and Honeywell
London’s RE:FIT leadership
- Framework Agreement to carry out works in the UK public sector
- Buyer guidance and toolkits- 42 buildings so far – Fire, Police and TfL:
- £7m investment, - £1m p.a. savings, 7-year payback- 28% energy saving average
- 58 buildings in Tranche 2- £70m London Green Fund for financing - ~ 3,000 buildings (40% of estate) in Tranche 3
Sources of capital investment
Established• Capital reserves• Public Works Loan Board• Banks• Regional Growth Fund• European Regional Growth fund• London Green Fund
Possible in the future• Regional revolving funds, e.g. Finance South East
Community Generation Fund• Local investors• Green Investment Bank
Energy Services Frontline
1. Carbon: At least 35% savings
2. Frontline: reallocate savings to services
3. Whole community: involving building users, sharing savings with community
4. Scaling up: pilots to mainstream, e.g. role of Green Investment Bank, HM Treasury accountancy rules
Recap of financing models covered
Aggregation via intermediate funds: small is beautiful and together can be large
Community share issues: achieve much more with community ownership
Local authority borrowing : for communities and for own estate
Service contracts: pure pay out of savings Wholesale refinance: role for Green Investment
Bank Risk pooling: e.g. Finance South East Self financing: from own balance sheets
http://www.forumforthefuture.org/[email protected]
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